That’s the crazy thing about 2008, when big banks were funding their operations with overnight loans from each other (and then lending to hedge funds at insane leverage ratios), all it took for a bank run to happen was to stop lending for a single day. It’s not like you needed a panic, just, “nope, not today.”
What if I told you that some financial institutions could move money off to some temporary location where it sits for a few hours, then move it back. Since this money sits elsewhere for this time, it doesn't count towards their regulatory ratios.
In theory you are supposed to comply with your regulatory ratios at all time. The excess over these regulatory minimums can fluctuate, but if you are in breach, you need to notify the regulator.
